Graham Perrett (Moreton, Australian Labor Party) Share this | Hansard source

I'll start with the bad news. The bad news is that in 2023 a staggering $2.7 billion was lost to scams in Australia. The good news is that this was 13 per cent lower than the preceding year. But, obviously, it's still far too high. That $2.7 billion figure is just one number, but it entails thousands and thousands of Australian heartache stories. But, as I said, it could have been $350 million or more—much worse.

Scams have become increasingly more sophisticated, and many originate from complex transnational criminal syndicates. It's not always easy to spot a scam, yet many victims still feel shame and embarrassment when they find their accounts are a little bit lighter. Each scam that is perpetrated represents an organisation or a person who has been deceived and has lost money. Scams are expensive, distressing and can be financially devastating for victims. That's not to mention the fact that they can stop people from communicating with the rest of the world—they're too scared to answer the phone, too scared to answer emails.

Australians have fallen prey—to the tune of hundreds of millions of dollars—to investment scams, fraudulent remote access and romance scams. That is why the Albanese Labor government is focused on developing a whole-of-economy prevention framework. One of our key election commitments was to protect Australians from scammers. Since coming to office we have directed over $180 million to fighting scammers. Part of this funding was directed towards the establishment of the National Anti-Scam Centre, the NASC. It sits within the Australian Competition and Consumer Commission and serves as a link between industry and government. One of its key aims is to enhance collaboration amongst government, finance, telecommunications, digital platforms sectors and law enforcement to combat scams. The intention of this collaboration is to disrupt scammers, whether that is to prevent contact, to interrupt contact or to stop fraudulent payments being made once a scammer has established a connection with their victim.

The NASC also runs the Scamwatch service. This is an excellent resource for us all. It shares up-to-date information on scams and offers valuable tips on how to spot a scam. It details the steps to take if you think you've been scanned and enables people to report a scam and therefore keep their friends and neighbours safe.

Labor has also legislated the establishment and maintenance of a register of legitimate sender IDs by the Australian Communications and Media Authority. This legislation puts an industry standard in place for telecommunications providers who manage SMS traffic. Telco providers are required to check texts with sender IDs to ensure that they're on the register. Those which are not may be blocked or the text message may be tagged with a warning or labelled as fraudulent.

The Albanese Labor government is now building on these measures to introduce the Scams Prevention Framework. Broadly speaking, it will require the private sector to adhere to robust industry codes and principles based obligations. The establishment of the framework will tackle head-on the current situation with scam protection, where there is inconsistency across sectors with both protections and responses.

The bill in front of the chamber employs a broad definition of what a scam is. This reflects the dynamic nature of scam activity, which is increasingly technically sophisticated and is continuously evolving. The core business of scammers is to cause harm or loss through deception. The bill reflects that this occurs in a variety of ways and in ever-changing ways. Similarly, the term 'consumer' is broadly defined. In the bill, it includes individuals or small businesses that access services provided by regulated businesses in Australia. Consumers may also use these services while out of the country but still be covered by the bill if the provider is a regulated entity in Australia.

The first sectors that will be required to comply with the Scams Protection Framework are banks, telecommunications providers and digital platforms that provide social media, paid search advertising and direct messaging services. These are the most common avenues that scammers use to target Australians. Scamwatch notes that in 2023 the most reported payment method used by scammers was bank transfers, with nearly $213 million in losses. Phone calls were associated with $116 million worth of losses and social media with nearly $94 million. Most scams originate via social media, phone, email, the internet, mobile apps and text messages, with the bank being the final link in the chain where the funds are transferred. The Scams Prevention Framework will have a consistent and enforceable approach, ensuring that all the components of specific sectors have strong protection. After all, scammers don't use just one method to defraud people.

The Scams Prevention Framework has six overarching principles. The first of these is enhanced governance for regulated entities, including the documentation and implementation of policies and procedures, targets, and the outcomes of scam prevention efforts. The next set of principles concerns regulated entities putting in place reasonable steps to prevent, detect and report scams. This means implementing additional layers of verification and validation procedures online and enhancing processes with the timely identification of scams. It also means alerting consumers as quickly as possible. These measures will help to disrupt the activity of scammers. Regulated entities will also have to report information on scams to the ACCC. Entities must report as soon as it is reasonable to think that the scam activity is underway, whether that's a communication or a transaction. The ACCC may then share this intelligence amongst other entities to disrupt the scammer's activities—that's the collaborative approach that I spoke about earlier. As you can see, to fight scammers effectively you need wide-ranging and concerted tactics.

The final two principles focus on disruption and response. The bill includes the provision of a 28-day safe harbour protection for regulated entities to take disruptive action, in good faith, while protecting third parties. There's also a requirement to continue consumer education and awareness. To enhance responsiveness to consumers, regulated entities must implement efficient ways for consumers to report scams and lodge complaints. A scam victim will have access to dispute resolution processes free of charge if a regulated entity has not met its obligations within the framework. To this end, regulated entities must demonstrate that they have an internal dispute resolution process and are also a member of a selected external dispute resolution system.

The external body responsible for dispute resolution for the initial sectors in the framework will be the Australian Financial Complaints Authority. The AFCA will address consumer complaints, including when the scam involves more than one entity. Consumers will also be able to escalate their complaints to the court system if a regulated entity has not operated within the framework appropriately. The dispute system will ensure ease of access for consumers. Basically, there is no wrong-door approach, as consumers can raise an issue with any regulated entity. The AFCA will also respond to consumer scam complaints, even if the issue involves multiple regulatory bodies. Consumers are given extra assurance, with a planned consultation on the dispute resolution model in 2025. We want to ensure it's working as we intend for consumers.

The Scam Protection Framework's mandatory codes will be sector-specific and provide a minimum set of standards for each sector. They also recognise the need to evolve to ensure the ongoing, effective disruption of scams. The bill proposes a multi-regulator approach to build on existing sector expertise. The ACCC will be the regulator for the principle based obligations as well as the digital platforms sector. The Australian Securities and Investments Commission will oversee the banking code, and ACMA will enforce the telecommunications code. This approach will ensure that no one body is overwhelmed, especially as additional sectors are brought into the framework.

Future editions could include superannuation, cryptocurrency, online marketplaces and other payment providers. The bill directs that the responsible Treasury minister can designate additional sectors to be subject to the Scams Prevention Framework. After that, the minister can direct the establishment of an enforceable code that works for that specific sector—tailored for how people interact with that particular sector.

What powers will the regulatory bodies have? They will be able to penalise an organisation up to $50 million for the worst breaches of the framework. That will obviously be an incentive for compliance. Regulators also have a range of lesser penalties to apply such as infringement notices, injunctions, public warnings and remedial directions, stepping up the process as modern businesses do. It's important to note a key difference between this bill and other international approaches such as in the UK. Labor is not implementing a mandatory-presumption-of-reimbursement approach. We want to address scam activity across all sectors by incentivising all sectors to take responsibility. After all, there are many opportunities to stop scam activity before the consumer loses money, not just at the point of the bank transfer.

This legislation is world leading. The Assistant Treasurer highlighted Australia's leadership of this issue when he attended the first Global Fraud Summit, in March 2024, and this bill reflects Australia's commitment to working with international partners on fighting scams. At the heart of this legislation is our determination to better protect consumers. We are determined to make Australia a harder target for scammers. Australians deserve to be able to participate in the digital economy safely and with confidence. The bill gives consumers additional peace of mind, knowing they have both strengthened protections and avenues for dispute resolution if required if it all goes bad.

On a final note, I would like to thank the assistant minister, Stephen Jones. I know that he is leaving the parliament and I particularly want to thank him for bringing scams to the front of people's minds throughout Australia along with how we as a nation can fight back. Rather than just retreat from scammers, now we are fighting back. I thank him for that. As I said at the start, we still lose too much. It is 13 per cent less this year than last year, which is $350 million, and it could have been a lot worse, but so much of that is down to Minister Jones. He has been a good friend and a good man. He is also a Dragons supporter, so that means the minister and I are the two Dragons supporters leaving the parliament, which I know is a great fact to him! Hopefully, some of the candidates who get elected will also be Dragons supporters. I wish him well and I commend the bill to the House.

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